STANBIC completes takeover of ADB

CITI FM reports that the takeover of the Agricultural Development Bank (ADB) by Stanbic Bank has been completed.

The takeover which could have been completed half way through the second quarter of this year had to be delayed a bit due to some further documentation that was needed by government from Stanbic.

Stanbic is expected to direct a substantial amount of its operations into lending to the Agricultural base of the economy with this takeover.

The Government of Ghana, through the Finance Ministry, owns 51.83% shares while the Bank of Ghana owns 48.17% shares.

But as a regulator of the banking industry, the Central Bank has found the need to offload its shares to a private investor in a bid to aid government in raising additional funds to finance other projects.

Government has also been impressed with Stanbic bank’s own quite effective support for agriculture. Stanbic provides 25% of all working capital of the local cocoa buying companies and is targeting to provide $104 million dollars in financing for its Licensed Buyers customers for the next cocoa crop season.

Government decided to sell of its stake in ADB because of the need to raise additional funds to finance other projects. A comprehensive re-branding exercise is expected to be conducted in due course of all the branches of ADB to reflect the brand name of Stanbic Bank.

The takeover by Stanbic Bank will give the bank immense control over the Western Union Money Transfer which has been under the control of ADB. ADB controls about 60% of the inflows from the Money transfer and this is expected to add to Stanbic’s foreign currency inflows. With Ghana being an import-based economy, there is no doubt the bank will gain greater flexibility in the foreign exchange market.